Looking forward, looking out

Tonight in the Lords, Peers will debate the BIS Department’s response to a recent report on SMEs, which came down very firmly in support of providing export services.

So what is being done in relation to the matters raised? Quite a lot it seems. Re-focusing the work of UKTI; building more partnerships and working with intermediaries to create more awareness and confidence; focusing on medium sized businesses; more UK export finance deals. All of this is very welcome but does UKTI have adequate qualified staff with business experience to satisfy the increased demands?

For example, parliamentary questions in the Commons last month revealed that the Export Refinancing Scheme has still not helped a single business. Neither has the Direct Lending scheme. Both were designed to replace the Export Enterprise Finance Guarantee – abandoned after it only assisted five firms. The number of transactions carried out by UK export finance has increased, but how many of these deals apply to SMEs? In general, we read that finance for SMEs is still falling.

I was rather disappointed that the Chancellor’s document ‘The Next Phase’ including a heading that spoke about “sustaining the many good initiatives of the last three years” – as if all of this started when the Coalition came to power. There was of course, government help for exporters when Labour was in power and indeed before. Ministers should be saying that what was done before is being built on rather than blamed. This is what will help convince those running SMEs that that Whitehall is serious about exports.

To give credit where it is due, I welcome the attempt to achieve some political continuity by appointing Trade Ambassadors from all political parties and none. (Shadow BIS Secretary Chuka Umunna led a UKTI trade mission to Nigeria and Ghana last May.) But it will only have an impact when it involves work with SMEs rather than a focus entirely on big deals in particular countries. Last month, the UK won a contract to run 16 further education colleges in Saudi Arabia. A clear sign of co-operation between government departments and the use of exports to assist capacity building, but were SMEs and UKTI involved?

Education, intangibles: they are all part of the knowledge economy, requiring the best brains. So why does the Home Office put barriers in the way. It is no use saying that because this is part of the cross-government industrial strategy there are no longer problems. Every businessman or researcher’s day to day experience says otherwise. This is where there is growing export potential for SMEs – the kind of growth that will balance our economy. So let’s have a unity of purpose.

Last month we were told that from September the ONS is going to overhaul our national accounts, to include all of our R&D. Our knowledge business is now going to be included in GDP instead of being considered a cost of production, bolstering GDP numbers. Leaving aside that this coincides with the run up to a general election, and that there is more to life than GDP, will this reform bolster export figures too?